break even?
makes it sound like like they're talking to investors not residents.
i dread to think how their "anslysis" works.
cant bear to do any more than skim this article though.
Housing market affordability is so bad that Zillow says it will take you 13.5 years to break even on a purchase from July onward
Submitted 1 year ago by return2ozma@lemmy.world to aboringdystopia@lemmy.world
https://finance.yahoo.com/news/housing-market-affordability-bad-zillow-100000012.html
Comments
oo1@kbin.social 1 year ago
joel_feila@lemmy.world 1 year ago
Back in the 50s to 70 we teeated hoises more like food. No one bought up all tge bread at a grocery store in hopes of selling letter at a high profit. During this time houses inflated mostly along side wages.
The the dark times came. The risr of the secondary real estate market ment people couldcquickly trade mortgages* like stock. This decoupled house prices from wages and turn te whole 2nd market into a new stock market
*technically they are not mortgages but mortgage back securities
echodot@feddit.uk 1 year ago
I’m not sure I quite understand what that means how would they even know if I’ve broken even or not?
I own my house but the only way I would know if I’d “broken even” was to constantly get it evaluated. Also is there analysis assuming that I’m going to do improvements or not?
Because you can buy a house, own it for 6 months and sell it again for a profit, and you can do that if you do renovations. Equally you can buy a house own it for 5 years and sell it and make a loss because you’ve not done any maintenance or renovations in that time.
I know for a fact the person I bought the house of hardly made any money on the sale because the roof has a giant hole in it. Obviously that brings the price down.
Moneo@lemmy.world 1 year ago
assumptions for closing costs, agent fees at the time of sale, home maintenance costs and interest payments
Break even being your house has increased in value by the amount you’ve spent on those expenses.
watty@lemm.ee 1 year ago
Based on the actual Zillow report, it’s just based on home values across the board in different regions. So, these are averages. Of course, if you make more improvements and stuff, your result would vary.
JackbyDev@programming.dev 1 year ago
My house is an investment in the sense that I’m putting money into a giant hole as opposed to an infinite hole like renting. But no, I don’t view it like I would a stock.
watty@lemm.ee 1 year ago
You can just click through to the actual Zillow report instead of Yahoo’s article about it: www.zillow.com/research/years-to-profit-33215/
They discuss the analysis right there.
IHaveTwoCows@lemm.ee 1 year ago
Great job, Zillow. You did this.
watty@lemm.ee 1 year ago
How did Zillow do this?
IHaveTwoCows@lemm.ee 1 year ago
Stop Real Estate Companies like Zillow and Opendoor from Price Gouging the … change.org/…/united-states-department-of-housing-…
WetAndFlummoxed@lemmy.world 1 year ago
I’m not saying he’s right, but Zillow started buying a ton of properties during the pandemic for significantly more than they were really worth in the hopes of flipping them for even more money.
IHaveTwoCows@lemm.ee 1 year ago
ZILLOW is Manipulating the Housing Market. They Need to Stop. - YouTube m.youtube.com/watch?v=Kx5FXRiSyc8
MonkderZweite@feddit.ch 1 year ago
Why does it not crash?
PoliticalAgitator@lemm.ee 1 year ago
It never will. If it so much as dips, the ultra wealthy will buy up everything they can find, inflating it once again.
Regulations could stop it easily, but profits are apparently more important.
Pyr_Pressure@lemmy.ca 1 year ago
Too many companies with deep pockets buying everything up to rent and then never selling. Once a company buys it, it’s pretty much off the market forever unless that company goes bankrupt but then they either get a bailout or another company buys that one for cheap.
Asafum@feddit.nl 1 year ago
Along with what the other comment said, all the people that are buying that aren’t corporations can actually afford the house they’re buying and since there’s no economic collapse they will continue to be ok (thankfully I guess?) so there won’t be a housing crisis other than the unaffordability crisis which isn’t a crisis to capitalists it’s just a feature of their market based system.
The solution “the market” chose was neofeudalism… Can’t buy, only rent. “I take your income forever and continuously raise the rent until you can’t afford it and then the next schmuck moves in. Where you go, who cares? Not my problem.” Lovely society we have…
Blackmist@feddit.uk 1 year ago
Why would it crash?
There’s near limitless demand and deliberately limited supply. Any dips will come from lack of affordability on lending as interest rates rise, but you’re talking hyperinflation for an actual crash.
So the house prices might drop by 20%, but you’ll be able to borrow 20% less. So if you’re fucked before any price drops, you’re still fucked afterwards.
dingleberry@discuss.tchncs.de 1 year ago
Just 13 years?
blanketswithsmallpox@lemmy.world 1 year ago
Was about to say. Why kind of not 30 year fixed loans are they offering now?
Even paying an extra 1/4 of my mortgage monthly only reduces it to like 22 years vs 30 lol.
blueeggsandyam@lemmy.world 1 year ago
It isn’t the amount of time it takes to pay off the house. It is the time it takes not to loose money on selling a house. The number was about 5 years when I purchased my home. You take the selling price of your home subtract the mortgage, taxes, and realtor fees. It now takes 13 years before you can sell your house and break even. This just makes investing in homes worse. It also makes buying a home more risky and inflexible.
guyrocket@kbin.social 1 year ago
When will the bubble burst?
OpticalMoose@discuss.tchncs.de 1 year ago
I don’t think it will burst. It’ll just slowly deflate as new houses come onto the market and demand eases. The main problem (at least where I live) is that there just aren’t enough houses being built. I don’t think we’ll see a sharp price drop anytime soon because there are so many people waiting to buy.
echodot@feddit.uk 1 year ago
The problem tends to be that houses are being built but they’re not the right houses. They’re all really expensive houses, there’s nothing for first time buyers.
maggoats@lemmy.world 1 year ago
I wonder this too, but I’m coming to believe that as long as investors are throwing money at housing and people need it, it might not burst. With enough wealth concentration, maybe it just all gets progressively bought up and rented out at insane prices, with growth coming from speculation among massive institutional investors.
But I haven’t really thought of this deeply or looked into whether it’s sound.
Dkarma@lemmy.world 1 year ago
This is what you’re seeing now where mega corps are buying up trailer parks and all the low end housing. Theyre cranking up the prices on these to justify cranking the prices on the mid range stuff and so on up the $ ladder.
There are no more low end housing being built anywhere. It’s all 350k and up being built.
Thats the main problem really. The shitty stuff got priced where mid stuff used to be and there’s no supply for first time buyers to use to build equity.
friend_of_satan@lemmy.world 1 year ago
I got an email yesterday telling me times have never been better to refinance my home. They swore that they could get me a number that was more than double my current rate.
krellor@kbin.social 1 year ago
I chuckle evily whenever I get a call from my mortgage company asking me if I'm happy with my mortgage. At 2.25% darn right I'm happy being below the current risk free rate of return.
jeffw@lemmy.world 1 year ago
Never been better for banks maybe. I refinanced during the pandemic and went from a 30 year to a 15 and barely changed my monthly payment.
Dkarma@lemmy.world 1 year ago
That’s normal. You either cut years or cut monthly payment. Very rarely both unless rates are actively dropping.
A 15 yr saves you six figures over a 30 yr iirc so congrats!
ultratiem@lemmy.ca 1 year ago
I mean they are literally just taking your money and telling everyone it’s a good thing. Fucking wild man. My buddy has a second property that went up from $1700 a month to $2700. Insane. That some private entity can one day decide people have too much money and just literally take it.
And capitalism is the way???